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Charles Hoskinson: Cardano and Ethereum will be the new home of Bitcoin

 


Cardano founder Charles Hoskinson explained in a Twitter video why we will see almost all Bitcoin on the Cardano and Ethereum network in the near future.


Charles Hoskinson made a daring prognosis: In just 5 years, the majority of all mined Bitcoin will be on the Cardano and Ethereum chains. He cited the high production costs of mining and the faster progress of the Cardano and Ethereum networks as the reason for this .


“Not only do I believe bitcoin is digital gold, there are real use cases and utility.”


Both gold and bitcoin mining require energy. In addition, both the global gold deposits and the number of all BTC are limited. According to Hoskinson, the “scarcity” and “cost of production” factors reflect the true value of Bitcoin and gold, respectively.


Hoskinson further argued that the production costs for all mined BTC are already priced into the current price. After all, "normal" gold would be worth something even without the gold manufacturers. The gold would potentially be even more valuable as companies no longer produce large quantities of new gold.


Just as gold would still be valuable without the producers, BTC would still be valuable without mining . In this case, the value may even increase with higher demand, since the future supply will no longer increase.


So Bitcoin does not need its own blockchain to be valuable and to fulfill its role as digital gold in the crypto economy. Instead, cryptocurrency holders can migrate to blockchains like Cardano or Ethereum and leverage competitors' smart contract programs.


Bitcoin owners are already able to send their BTC directly to the Cardano or Ethereum ecosystem via so-called wrapped tokens . According to Hoskinson, the majority of all “Bitcoin Wrapped Tokens” will be on other chains in the next 5 years because the “gold mine is running dry”.


The BTC gold mine is disappearing

The BTC network does not currently offer the necessary prerequisites for many more complex innovative projects like this one. According to Hoskinson, for example, it would currently only be onCardanopossible to create a stablecoin with BTC as partial collateral for countries like Venezuela. In general, Hoskinson does not believe that the ecosystem of the largest cryptocurrency to date will keep up with the further development of Cardano or Ethereum:


“The BTC payment network is no longer useful. (…) BTC is currently only optimized to be the gold mine.”


The Cardano founder also wondered if, with rising energy prices and greater mining difficulty, it would soon be worth mining many of the 2 million remaining BTC. In his opinion, the source of gold will eventually dry up - and with it the Bitcoin payment network will also disappear.


“Letting the BTC mine run for the next 100 years just to get 2 million BTC is that really a good energy investment?”


Cardano and Ethereum offer advantages for wrapped BTC

Hoskinson also sees a clear advantage in the proof-of-stake blockchains Cardano and Ethereum due to the significantly lower energy consumption, cheaper transaction costs and the smart contract functionality. For comparison: Bitcoin is currently responsible for 0.4% of global electricity consumption. Ethereum, on the other hand, reduced its stake from 0.2% to almost 0% after the merge


Apart from that, Cardano and Ethereum offer an opportunity to keep the previously mined BTC out of the current financial system. According to Hoskinson, the dream of decentralizing Bitcoin has currently failed due to reality:


“Most of the BTC in circulation is managed by third parties. That's a fact."


However, in the form of wrapped BTC, Cardano and Ethereum users have the option of storing their coins themselves instead of having to give the key to a third party. In addition, the owners and the transactions remain anonymous on Cardano . This is exactly what the BTC inventor Satoshi-Nakamoto wanted, which is why Cardano is also acting in the interests of BTC advocates, according to Hoskinson.


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